Japanese Prime Minister Shinzo Abe agreed with his Vietnamese counterpart that an arbitration court's decision this week on the South China Sea must be observed, Japan's Kyodo news agency said on Friday.

The court in The Hague ruled China has no historic title over the waters of the South China Sea and that it has breached the Philippines' sovereign rights with its actions, infuriating Beijing, which dismissed the case as a farce.

Abe and Vietnamese Prime Minister Nguyen Xuan Phuc were in Mongolia for a summit of Asian and European leaders, known as ASEM.